XML 27 R17.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Discontinued Operations | 9 Months Ended
--- | ---
Sep. 30, 2022
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations | Discontinued Operations On March 10, 2020, Travelzoo issued a press release announcing that it was exiting its loss-making business in Asia Pacific. The decision supports the Company’s strategy to focus on value creation for shareholders by focusing on growing the businesses in North America and Europe. The Asia Pacific business ceased operations as of March 31, 2020, except for the Company’s Japan and Singapore units, which were held for sale. The Company has classified Asia Pacific as discontinued operations at March 31, 2020. Prior periods have been reclassified to conform with the current presentation. The following table provides a summary of amounts included in discontinued operations for the three and nine months ended September 30, 2022 and 2021 (in thousands):
| Three Months Ended |  | Nine Months Ended
| September 30, |  | September 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Revenues | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Cost of revenues | — |  |  | — |  |  | — |  |  | — |
Gross profit | — |  |  | — |  |  | — |  |  | — |
Operating expenses: |  |  |  |  |  |  |
Sales and marketing | — |  |  | — |  |  | — |  |  | — |
Product development | — |  |  | — |  |  | — |  |  | — |
General and administrative | 7 |  |  | 17 |  |  | 15 |  |  | 29 |
Total operating expenses | 7 |  |  | 17 |  |  | 15 |  |  | 29 |
Loss from operations | (7) |  |  | (17) |  |  | (15) |  |  | (29) |
Other income (loss), net | 12 |  |  | (2) |  |  | 19 |  |  | 24 |
Income (loss) before income taxes | 5 |  |  | (19) |  |  | 4 |  |  | (5) |
Income tax expense | — |  |  | — |  |  | — |  |  | — |
Net income (loss) | $ | 5 |  |  | $ | (19) |  |  | $ | 4 |  |  | $ | (5) |
On June 16, 2020, in connection with its Asia Pacific exit plan, the Company completed a sale of 100% of the outstanding capital stock of Travelzoo Japan K.K. (“Travelzoo Japan”) to Mr. Hajime Suzuki, the former General Manager of Japan of the Company (the “Japan Buyer”) for consideration of 1 Japanese Yen. The Company recognized a pre-tax loss of $128,000. T he parties also entered into a License Agreement, whereby Travelzoo Japan obtained a license to use the intellectual property of Travelzoo exclusively in Japan and South Korea in exchange for quarterly royalty payments based on revenue over a 5-year term, with an option to renew. However, Travelzoo Japan is only obligated to pay Travelzoo if Travelzoo Japan has a positive EBITDA (earnings before interest, taxes, depreciation and amortization) adjusted pro forma before royalty expenses, according to Travelzoo Japan’s income statement. Travelzoo was not able to estimate whether Travelzoo Japan will generate positive EBITDA based on the uncertainties, and no amount has been recorded for future royalties under this agreement. Licensing revenue is booked with a lag of one quarter. The Company did not record royalties from Travelzoo Japan for 2020. The Company records royalties for its licensing arrangements on a one-quarter lag basis. A n interest free loan was provided to the Japan Buyer for JPY 46.0 million (approximately $430,000) to be repaid over 3 years. The Japan Buyer repaid $133,000 in 2021. The Company did not recognize royalties from Travelzoo Japan for t he three months ended September 30, 2022 and 2021, respectively. The Company recognized royalties of $0 and $9,000 from Travelzoo Japan for the nine months ended September 30, 2022 and 2021, respectively. On August 24, 2020, the Company completed a sale of 100% of the outstanding capital stock of Travelzoo (Singapore) Pty Ltd (“Travelzoo Singapore”), to an unaffiliated entity, Finest Hotels Pty Ltd d/b/a Travelzoo (“AUS Buyer”), which is fully owned by Mr. Julian Rembrandt, the former General Manager of Southeast Asia and Australia of the Company for consideration of 1 Singapore Dollar. The parties also entered into a License Agreement, whereby the AUS Buyer obtained a license to use the intellectual property of Travelzoo exclusively in Australia, New Zealand and Singapore and non-exclusively in China and Hong Kong for quarterly royalty payments based upon revenue over a 5 year term, with an option to renew. Travelzoo was not able to estimate whether the AUS Buyer will generate revenues based on the current uncertainties, and no amount has been recorded for future royalties under this agreement. Licensing revenue is booked with a lag of one quart er. The Company recorded $8,000 and $2,000 in licensing revenue from the licensee in Australia, New Zealand, and Singapore for the three months ended September 30, 2022 and 2021, respectively. The Company recorded $18,000 and $2,000 in licensing revenue from the licensee in Australia, New Zealand, and Singapore for the nine months ended September 30, 2022 and 2021, respectively. The following table presents information related to the major classes of assets and liabilities that were classified as assets and liabilities from discontinued operations in the Condensed Consolidated Balance Sheets (in thousands):
| September 30, 2022 |  | December 31, 2021
ASSETS |  |  |
Cash, cash equivalents and restricted cash | $ | 14 |  |  | $ | 32 |
Accounts receivable, net | — |  |  | — |
Prepaid expenses and other | 21 |  |  | 39 |
Total assets from discontinued operations | $ | 35 |  |  | $ | 71 |
LIABILITIES |  |  |
Accounts payable | $ | 402 |  |  | $ | 473 |
Accrued expenses and other | — |  |  | — |
Deferred revenue | 11 |  |  | 12 |
Total liabilities from discontinued operations | $ | 413 |  |  | $ | 485 |
The net cash used in operating activities for the discontinued operations for the nine months ended September 30, 2022 and 2021, were as follows (in thousands):
| Nine Months Ended
| September 30,
| 2022 |  | 2021
Net cash provided by (used in) operating activities | $ | (18) |  |  | $ | 10 |

X
- References No definition available. + Details
Name: | us-gaap_DiscontinuedOperationsAndDisposalGroupsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI https://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=2122178 + Details
Name: | us-gaap_DisposalGroupsIncludingDiscontinuedOperationsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration